iPhone production will see major impact if China factory halt continues
Production of the iPhone could be disrupted by the coronavirus outbreak if things get much worse, with Apple assembly partner Foxconn reportedly halting the majority of its production in China until February 10.

One week ago, Foxconn claimed its facilities were prepared to fulfill all global orders for product assembly, which would include Apple product lines like the iPhone, iPad, and Mac, despite the spread of the virus. In a new report, Foxconn's production has seemingly taken a hit, due to having many facilities based in China.
A source of Reuters claims Foxconn has halted "almost all" of its China-based production, after companies in the area were told to shut down until at least February 10. The shutdown time may be extended depending on the spread and strength of the virus, which could potentially cause further delays.
Companies operating in the Chinese major manufacturing hub Suzhou were informed to stay closed until February 8, while factories in Shanghai were to do so until February 9. The Dongguan manufacturing hub has been instructed to close until February 10.
Foxconn has so far seen a "fairly small impact" from the outbreak, the source insisted, due to shifting production in other territories to fill the gap, including in India, Mexico, and Vietnam. However, the source believes Foxconn can make up for the imposed delays by making the factories work in overtime.
A continued shutdown beyond February 10 could affect Foxconn's shipments, with the source pointing out there are concerns with the Guangdong province and Zhengzhou in Henan province, areas where a number of key iPhone facilities operate.
"What we are worried about is delays for another week or even a month," the source told the report, adding "It definitely will have an impact on the Apple production line. The tricky question is whether we will be able to resume production. It's up to the instructions given by central and provincial governments."
Foxconn employees and clients have been told to not head to the factories, with the usual rates of pay provided for those who followed the rules, a memo seen by the report adds. Employees are also offered a bounty for reporting others who break the rules, with a dedicated hotline also open for tips.
Employees returning to factories ahead of time will apparently be "severely" punished.
Analyst Ming-Chi Kuo estimates the iPhone shipments alone could be severely disrupted, possibly reducing overall shipments in the quarter by as much as 10%.
The virus has also led to Apple closing all of its 42 stores in China, as well as an unspecified number of local Apple offices, in what it referred to as "an abundance of caution" at the start of February. While the stores will have an immediate effect on revenue from the region, it will also impact revenue for a period after, with potential customers opting to stay home instead of risking infection.
The closures are a far cry from one week ago when Apple CEO Tim Cook discussed the possible impact of the virus outbreak, a time when Apple had only encountered one store closure and enforced a limitation on employee travel. "We have alternate sourcing and contingency plans," Cook explained during an investor call, while admitting it was factoring in factory re-opening delays into its guidance.

One week ago, Foxconn claimed its facilities were prepared to fulfill all global orders for product assembly, which would include Apple product lines like the iPhone, iPad, and Mac, despite the spread of the virus. In a new report, Foxconn's production has seemingly taken a hit, due to having many facilities based in China.
A source of Reuters claims Foxconn has halted "almost all" of its China-based production, after companies in the area were told to shut down until at least February 10. The shutdown time may be extended depending on the spread and strength of the virus, which could potentially cause further delays.
Companies operating in the Chinese major manufacturing hub Suzhou were informed to stay closed until February 8, while factories in Shanghai were to do so until February 9. The Dongguan manufacturing hub has been instructed to close until February 10.
Foxconn has so far seen a "fairly small impact" from the outbreak, the source insisted, due to shifting production in other territories to fill the gap, including in India, Mexico, and Vietnam. However, the source believes Foxconn can make up for the imposed delays by making the factories work in overtime.
A continued shutdown beyond February 10 could affect Foxconn's shipments, with the source pointing out there are concerns with the Guangdong province and Zhengzhou in Henan province, areas where a number of key iPhone facilities operate.
"What we are worried about is delays for another week or even a month," the source told the report, adding "It definitely will have an impact on the Apple production line. The tricky question is whether we will be able to resume production. It's up to the instructions given by central and provincial governments."
Foxconn employees and clients have been told to not head to the factories, with the usual rates of pay provided for those who followed the rules, a memo seen by the report adds. Employees are also offered a bounty for reporting others who break the rules, with a dedicated hotline also open for tips.
Employees returning to factories ahead of time will apparently be "severely" punished.
Major Outbreak
The coronavirus -- officially titled 2019-nCoV -- is believed to impact Apple's sales in a number of ways. Chiefly this is going to impact Apple's manufacturing lines via Foxconn and other suppliers.Analyst Ming-Chi Kuo estimates the iPhone shipments alone could be severely disrupted, possibly reducing overall shipments in the quarter by as much as 10%.
The virus has also led to Apple closing all of its 42 stores in China, as well as an unspecified number of local Apple offices, in what it referred to as "an abundance of caution" at the start of February. While the stores will have an immediate effect on revenue from the region, it will also impact revenue for a period after, with potential customers opting to stay home instead of risking infection.
The closures are a far cry from one week ago when Apple CEO Tim Cook discussed the possible impact of the virus outbreak, a time when Apple had only encountered one store closure and enforced a limitation on employee travel. "We have alternate sourcing and contingency plans," Cook explained during an investor call, while admitting it was factoring in factory re-opening delays into its guidance.
Comments
It sounds like it's more or less equivalent (in terms of health effects) to the flu in the absence of a flu vaccine -- that is, hardly cataclysmic.
Rather than the virus causing economic hardship, it seems like it's the reaction to the virus that may cause hardship.
Cataclysmic in terms of an economy if you have to isolate and quarantine your population for any length of time.
As far as who it's killing, I don't think the data is set on that. And, we're still in the vertical stage of contagion, with no plateau in sight yet.
https://www.scmp.com/news/china/society/article/3048792/coronavirus-tally-epicentre-wuhan-may-be-just-tip-iceberg
https://www.scmp.com/news/china/politics/article/3048611/coronavirus-scientists-identify-possible-new-mode-transmission
New virus strain -> infects a significant number of people -> provides a breeding ground -> virus mutates to becomes significantly more infectious with high mortality rate -> civilization ends
These things aren’t likely, but high population + global travel (lack of population isolation) + drug therapy’s (that may increase mutations) etc. increases the chance that one of these new strains will be devastating.
BOOM Zombies!
I always liked the stories where: new dangerous virus appears, we create a vaccine but it’s rushed with minimal studies, mistakes are made and the live vaccine is released.
BOOM Zombies!
A colleague in Taiwan says the actual afflicted in Wuhan is 30x to 100x higher than what China is reporting.
Employees returning to factories ahead of time will apparently be "severely" punished".
Sounds like fun working for Foxconn.
Duhhhh..,
Don’t take that mortality rate as gospel. To calculate that rate, you need to know two things:
1. Numerator
2. Denominator
#1 is relatively easy. You have a dead body, you test it for Coronavirus.
#2 is much harder. You don’t go around testing all the live bodies for Coronavirus. If most people who get the virus don’t show noticeable symptoms beyond cold symptoms, then you’ll never know they had it and they’ll be excluded from #2. That results in an exaggerated mortality rate.
Edit:
another perspective: https://www.psychologytoday.com/us/blog/its-catching/202001/the-chinese-coronavirus-is-not-the-zombie-apocalypse
https://www.businessinsider.com/wuhan-coronavirus-pandemic-what-that-means-epidemic-difference-2020-2
- Scientists say the Wuhan coronavirus that has so far killed at least 362 people and infected over 17,000 other people could soon become a pandemic.
- The World Health Organization defines a pandemic as "the worldwide spread of a new disease."
- It's also defined by a lack of available treatment, a lack of human immunity, and an ability to spread from person to person.
- The Wuhan coronavirus is "very, very transmissible, and it almost certainly is going to be a pandemic," Dr. Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, told The New York Times on Sunday.
Even this isn't the Zombie Apocalypse, but it could be broad enough in scope to start a mild world wide recession, which has all kinds of implications politically and economically.